The Queen’s Speech today looks set to be a relatively sedate affair. As Stephen Tall observes, “the Coalition is now pretty much intellectually dead” when it comes to its legislative agenda. Enthusiasm for pushing new ideas has been replaced with a business like determination to deliver what is already underway.
The content of the Queen’s Speech is nonetheless important. It will shape what happens over the course of the next parliamentary session, and will therefore influence the outcome of the General Election. If CentreForum had the privilege of writing the Speech, we would focus on three headline issues in particular: planning, higher education and immigration.
Here, briefly, is what we have in mind. (Note to commenters: this list is not exhaustive!)
Planning Bill
The Communities Secretary Eric Pickles once described our community land auctions idea as “communist”. He must be wondering why so many capitalists, including the Financial Times and George Osborne, think it is a good idea.
When land in the South East is transferred from agricultural to residential use, it increases in value by as much as £45,000 per plot.
Under the current system, that money goes straight to developers, while much of the social cost is borne by neighbours. Under community land auctions, it would go to the community. A village of 45 houses which allowed just one extra house to be built would receive £1,000 for every house.
This is a significant incentive to accept housing development and we want the coalition to legislate for it by the end of the parliament. More house building will mean more homes, more jobs, a smaller housing benefit bill and a rising growth rate.
Higher Education Bill
The Government should continue to raise controls on undergraduate numbers and introduce an income contingent loans system for postgraduates. Expanding higher education will cost nothing as the government is in the unique position of being able to borrow at zero per cent real interest rates over a long period.
The policy will help to reduce youth unemployment immediately, and it will be good for long term growth – investment in human capital always is.
Immigration Bill
The immigration debate is currently dominated by the Left, which leans towards restricting immigration at times when domestic income inequality is on the rise, and the Right, which calls for restricting immigration to protect ‘British jobs’ and/or ‘British culture’. A big challenge for those in the liberal Centre is to work out how public confidence in the immigration system can be restored without having to sacrifice key liberal principles, such as freedom of movement.
Abolishing the hard ceiling on net immigration and removing students (who contribute £3.3 billion per annum to the UK economy) from the official immigration figures are two of the measures that should be contained in a liberal Immigration Bill. But so too is a commitment to tighten up border enforcement and visa administration. It is about balancing freedom of movement with personal responsibility – a liberal approach to immigration that CentreForum will be exploring in coming months.
Our Associate Director of Economic Policy, Tom Papworth, explained our thinking around the Queen’s Speech on BBC Radio 4 Today this morning. You can be listen to it on BBC iPlayer here at around 49 minutes in.
‘The Independent View‘ is a slot on Lib Dem Voice which allows those from beyond the party to contribute to debates we believe are of interest to LDV’s readers. Please email [email protected] if you are interested in contributing.
* Tom Frostick is head of press and communications at CentreForum, the liberal think tank.
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13 Comments
Very cheeky to say that the left wants more immigration control. The drivers for immigration controls has always come from the Daily Mail, Express, and Sun – all right wing newspapers and now being pushed harder by UKIP. Before that it was the Tory party, noticeably in the leaders debates in the 2010 general election – factor where the Tories appeared to gain support.
Both liberals like Nick Clegg and the Blairites in the Labour Party are also calling for immigration controls.
What ought to be top of the agenda should be how to tackle climate change, how to stop nuclear weapon proliferation, how to reduce the gap between rich and poor, how to disperse power from central government and how to improve public services.
Geoffrey: I agree that the noisiest supporters of immigration controls can be found on the ‘right’. By ‘left’, I was referring to Ed Miliband’s Labour movement, whose language around immigration has toughened since 2010 to counter complaints that Blairite immigration policy (far from being restrictive) was too liberal. What we are hoping to do at CentreForum is develop a distinctive ‘liberal’ position which can inform the major parties’ thinking in the run up to 2015
About UKIP and immigration. As a pro EU Liberal Democrat who believes in Freedom and Fairness, I think what is needed is EU legislation to regulate the costs of the free movement of labour across the member states borders.
For instance, an immigrant to another EU state would be entitled only to the benefits that they could receive from their home state. The cost of those benefits paid to the immigrant would be deducted from the cost of the states EU contribution. The cost of the benefits could also be added to the immigrants home state’s EU contribution.
Also, any EU immigrant would automatically be given a work permit and would be able to claim benefits from that state after the person had paid income tax for five years. Another requirement would be to learn the language of the new country. These regulations would apply to every member state.
It is unfair to impose social and economic burdens on a person or a state at the same time as reducing their economic power to carry those burdens.
I believe there is a problem with the free movement of criminals across borders. The punishment for a criminal is usually the temporary withdrawal of a human right; liberty. Perhaps this should be extended to five years loss of liberty after release from prison in respect of being allowed to live and work in another country. An ex convict would have to have worked for five years in their own country without committing any criminal offence before regaining the right to live and work in another member state.
These rules and regulations should be enacted by the European Parliament and apply to all member states.
The incentive for new houses is currently 6 years of band D council tax to a council as new homes bonus. That’s about £10,000 a property, and it hasn’t resulted in a single authority requesting more houses. It is an example of the detachment from the real world of “think tanks” which are little more than bloggers with posh letterheads that they see £1000 as an incentive when ten times that has failed.
You can’t have absolute freedom of movement and border controls – whether you call it the Liberal Centre of the mushy middle – inevitably any proprosal will be a compromise on a spectrum of what is and isn’t allowable and possible.
@Geoffrey: “Very cheeky to say that the left wants more immigration control”
Really? Is the Daily Mirror so pro-immigration? Was it not a Labour prime minister who talked of “British Jobs for British Workers”? Has the TUC suddenly embraced open borders? Anti-immigration sentiment has been one of the many issues that has united “Right” and “Left” since time immemorial.
@Caracatus: “The incentive for new houses… hasn’t resulted in a single authority requesting more houses”
I would be interested to see your evidence for that bold statement. Not a single local authority? Planning authorities do not need to “request” new houses, but they can take the opportunity of the New Homes Bonus into account when granting permission.
Having said that, there remains a problem that local planning authorities are too large. Even if 1,000 new homes were agreed, netting the local authority an additional £45 million, there would be major distributional questions resulting from the fact that the benefits would be distributed across hundreds of thousands of people in the local authority while the costs fell on the few thousand in close proximity to the development. For this reason I would be inclined to finesse Tim Leunig’s proposals with a devolution of planning to much smaller community levels. If planning was conducted at the village and parish level, the planning gain would become a real driver to sustainable development.
“bout UKIP and immigration. As a pro EU Liberal Democrat who believes in Freedom and Fairness, I think what is needed is EU legislation to regulate the costs of the free movement of labour across the member states borders.”
So fundamentally the UK steals other countries workers and then makes them foot the bill?
“For instance, an immigrant to another EU state would be entitled only to the benefits that they could receive from their home state. The cost of those benefits paid to the immigrant would be deducted from the cost of the states EU contribution.”
First, immigrants from the EU only have rights to benefits for the first three months of their stay in said country, after that they must prove themselves to be self-sufficient as the host nation no longer has any obligations to support them, so this whole benefits thing is a non-issue and always has been. It is something that newspapers like to make a big fuss over because, well, that is what they do, not because of any actual issues here.
Secondly, this is would be grossly unfair because we would have to fundamentally say that citizen is only allowed to claim benefits from their country of origin as it would simply to be impossible to practically marry two different nations’ benefits systems in some fused form. This is problematic for two reasons:
-If a Romanian family moved to the UK they would only be entitled to Romanian benefits, which is I presume is very insubstantial compared to the UK’s living costs driving them into poverty should they fall on hard-times; this is especially unfair if they are actually a working family who would otherwise be entitled to income based-benefits that only the UK system offers.
-On the other hand UK citizens could in theory move to other countries with much cheaper living while continuing to make the UK support them on benefits. This means they would still be taking money from our pot, but would be keeping nothing back into our economy.
“Another requirement would be to learn the language of the new country. These regulations would apply to every member state.”
This would be a disaster for UK immigration statistics because currently the vast majority of those moving to the UK from the EU can speak English; however, the number of UK citizens moving to other EU countries who can actually speak the host nations language is probably not quite so high. So fundamentally you are stopping UK citizens moving outside of the UK, while not really impeding those entering. It is also worth noting that the best way to learn a language is by moving to a country where it is widely spoken, so the best chance most UK citizens have of learning a second language is through the opportunities afforded to them by the freedom of movement principle.
This would also be negative for many EU countries economies as the number of people who can speak, say, Polish is probably quite limited. This means you are stopping Poland from allowing individuals to immigrate there even if they may need them for particular industries which they would not need to know Polish to work in.
Finally, most EU universities teach their countries in English (as well as the host nation’s native tongue) in order to allow for more international students to study at them. This means these universities would suddenly no longer to be able to accept these students which would be most negative for the host nation’s economy.
“It is unfair to impose social and economic burdens on a person or a state at the same time as reducing their economic power to carry those burdens.”
Yet that is what you have proposed we do???
” Expanding higher education will cost nothing as the government is in the unique position of being able to borrow at zero per cent real interest rates over a long period.”
Yeah but surely if the government borrows too much then we will be seen as greater risk and the cost of new bond issues will rise.
I don’t understand how the chief economist at Centre Forum and a professor at Oxford University have come to the conclusion that borrows costs nothing. Or are you simply spinning?
Not to mention that extra borrowing puts pressure on inflation and therefore the need for quantitative tightening and eventually increasing interest rates.
Eddie – this was published in the FT letters’ page. Interest rates have fallen further since it was published
The cost of expanding higher education is – zero
From Dr Tim Leunig and Prof Neil Shephard. (February 8, 2012)
Sir, The new student loan system was predicted to involve significant losses, as not all students would repay in full. Falls in index-linked bond yields since mean the government can borrow to fund student loans at 0 per cent in real terms. This fall in costs is sufficient to completely eliminate the predicted losses. The positive real interest rate paid by high-earning graduates will cover the losses on those unable to repay their loans. As a result the medium-term cost to government of expanding higher education is zero, according to the Department of Business, Innovation and Skills’ own model.
The government should increase the number of students at English universities as a matter of urgency. Otherwise we will be in the bizarre position of having would-be students willing to pay the full cost of their university education, and banned from doing so by the government. Expanding university places will cut youth unemployment in the short run, and raise employability, average wages, growth and tax revenues in the medium to long term.
Tim Leunig, Chief Economist, CentreForum, and London School of Economics
Neil Shephard, Department of Economics, University of Oxford
Although you could argue that borrowing today costs “zero”, it is not risk free. Perhaps the reason the two of you are saying expanding higher education is “free” is because you both work for universities.
Regardless of your motives, nothing is ever free and you shouldn’t say it is.
Also your only real recommendation in your Immigration Bill is to remove students because they contribute to the economy. Well if that is the case then why don’t we move bankers, footballers, doctors and everyone else with a decent job?
Pure vested interests, which Lib Dems are against.
Your Community Land Auctions idea is pure communist and based on nonsense economics. If there are two pieces of land, and one has better prospects than the other of being turned residential, then the one with better prospects will be worth more. Likewise houses nearby the land with better residential prospects will be worth less. This £45,000 doesn’t just pop into existence overnight and nor should it be given to the community due to “luck”.
I take back the luck argument because you didn’t use it, but everything else stands.
Even if you come back and show examples of the land value increasing by £45k overnight, the risk that it wouldn’t have been accepted would have been included into the price; maybe not perfectly, but at least to some degree.